Actions speak louder than wordsThe government unveiled an outline to upgrade the services sector — the seventh in size under the incumbent administration. The recipes are all the same, under new menu titles and sponsored by different names of the deputy prime minister of the economy. They all aim to promote health and medical care, tourism, education, finance, software, and logistics. They all promise to lift regulations and barriers to make way for new growth.
The services sector is a sector the government returns to every time to stimulate growth because it generates more jobs than the manufacturing sector. Factories and exporters no longer can be depended on to make jobs. Manufacturers are losing competitiveness and exports are sagging due to a prolonged slump in external demand. Jobs in the manufacturing sector have decreased 900,000 since 1990, while the services sector added more than 8 million.
Economies around the world are realigning toward domestic demand through promotion of the services sector. External trade conditions have worsened amid increasing protectionism as underscored by the British decision to leave the European Union. Vitalizing the services sector has become imperative to save the economy.
The latest government outline is all good. It always has been. The problem is that actions have not followed. The measures are stalled and killed at the legislative level due to heavy lobbying from interest groups. It remains to be seen whether the latest measures will see daylight this time.
The so-called Basic Act to Advance Services Industry has been gathering dust for six years.
The 20th legislature must pass the act, first of all. The government maintains it cannot do much without legislative support in legislations. But it must do whatever it can to coordinate differences in the industry and act first with the changes that can be done with its own jurisdiction instead of blaming everything on the legislative.
JoongAng Ilbo, July 6, Page 30